A $500 million plan to redevelop Jay Peak Resort in Northern Vermont was a Ponzi scheme that bilked people through the EB-5 investor visa program, three foreign citizens claim in a RICO class action.
The SEC filed six lawsuits across the country in April with similar allegations against Jay Peak's owner-operators, Ariel Quiros, William Stenger, et al., and financial institutions involved in the project, including Raymond James Financial and People's United Bank.
Jay Peak is 5 miles from the Canadian border in Vermont's Northeast Kingdom, three sparsely populated counties known for their wild, scenic beauty, and not particularly strong economic base.
Residents of the Kingdom viewed the Jay Peak project as an economic lifesaver, as Quiros and Stenger promised to invest $500 million in the project, raising much of the money through the EB-5 program. The claimed the project would create 5,000 construction jobs that would lead to 5,000 permanent jobs in 10 years.
An EB-5 investor visa allows a foreign citizen to qualify for permanent U.S. residency if he or she invests $500,000 or more into jobs in specified U.S. areas, and/or create 10 more U.S. jobs.
In the May 17 federal class action, lead plaintiff James B. Shaw, of England, says he invested more than $500,000 in a Jay Peak project. His co-plaintiffs, from the Netherlands and Canada, say they did so too.
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